Image credit: NYC Department of Design and Construction.

Contractor claimed that the City contract restricted it to purchasing concrete from a single concrete supplier. In April 2014, Perfetto Contracting Co., an electrical contractor, successfully submitted a bid to the Department of Design and Construction for a contract to work on the Broadway Junction Transit Hub Enhancement Project. The contract required specific concrete designs to be procured from a NYSDOT-approved vendor. Perfetto began work in October 2014.

In April 2015, Perfetto obtained a quote for the concrete system from Integrated Roadway Co., a supplier not identified on the NYSDOT-approved vendor list, for $652.97 per cubic yards of concrete, and submitted a change request to DDC to use Integrated’s concrete system. DDC denied the change request.

As a result, Perfetto claimed it had no choice but to contract with Fort Miller Construction Company at a higher rate of $1,150.00 per cubic yard of concrete. Perfetto claimed that DDC’s decision had converted Fort Miller into a required sole-source supplier which under the contract Perfetto was compelled to use.

Perfetto sought additional compensation of $218,600 reflecting the difference between the price charged by Fort Miller and the price offered by Integrated. DDC denied Perfetto’s request for the change order, ruling that the NYSDOT vendor list contained more than one suitable supplier on the NYSDOT vendor list, and that Perfetto failed to properly estimate its bid and exercise its options before it contracted.

The Comptroller agreed, and Perfetto appealed to the Contract Dispute Resolution Board. The Board rejected Perfetto’s appeal, ruling that a contractor is obliged to ascertain the contract requirements pre-bid. Perfetto’s failure to do so did not entitle it to an equitable adjustment price for work already specified in the contract. Perfetto failed to check the bid specifications which were available to all bidders or research available designers/suppliers before submission. The Board reasoned that Perfetto should have sought clarification with regard to ambiguities about system specifications and other prospective suppliers. Perfetto, an experienced contractor, knew or should have known of this obligation prior to bidding and failed to show that it made reasonable efforts to ascertain whether there were other potential designers/suppliers of an alternate system, in accordance with the contract’s specific system requirements.

Perfetto Contracting Co., Inc. v. Dep’t of Design and Constr., OATH Index No. 1162/18, mem. dec. (Jul. 25, 2018).

By: Abby Cannon (Abby is a New York Law School student, Class of 2020.)